⚖️Loans
How do loans work within Skyline Digital’s platform?
The new loans feature on Skyline Digital’s platform allows users to obtain crypto-to-fiat loans through partnerships with on-chain providers like Aave and Spark.
To access this new feature, you must be fully onboarded after completing the Know Your Customer (KYC) or Know Your Business (KYB) verification process (see Onboarding FAQs).
The loan process involves the following steps:
Select the “Fiat Loans from Crypto” transaction type OR the "Crypto to Fiat" type (and then choose the Loan option).
Choose a collateral token to deposit and the stablecoin you wish to receive.
Add the details of any payments you want to make, including multiple currencies and beneficiaries if needed.
Review the loan information, including required collateral, Health Factor, net APY, and fees.
Use the Advanced configuration to compare different providers and adjust your collateral or stablecoin options.
Set a deposit allowance in your wallet for our smart contract for the collateral.
Review all details and accept the final quote.
Which partners does Skyline Digital resort to for this feature?
Skyline Digital aggregates loans from various on-chain providers, including Aave and Spark. As we evolve, we will accommodate more partners that can offer the best crypto to fiat loans options.
If you have a specific provider in mind that you'd like us to include, please let us know.
How can I check the interest rate?
Interest rates for loans can be viewed during the loan configuration process on Skyline Digital’s platform. The net Annual Percentage Yield (APY) is displayed on the main screen, and more detailed information about each loan, including different interest rates per token, can be accessed by clicking on “Advanced”.
During the entire time that your loan is active, you can continuously check the interest rate on your selected providers’ dashboard, as well as the health factor value (see more information below).
How is the interest charged?
Interest on your loan is charged at the time of repayment to the original provider where the loan was initiated. Skyline Digital does not collect any interest from your loan.
Does Skyline Digital charge a fee for this service?
Yes, Skyline Digital charges its standard transactional fees, usually applied for Crypto to Fiat transactions, for the new Loans feature. These fees are visible during the transaction configuration. Note that fees for loans may be higher than our standard 1% for regular crypto to fiat payments, up to 1,5%, depending on the loan.
What are the requirements for the Crypto to Fiat loans?
To qualify for Crypto to Fiat loans, you need to complete our Know Your Customer (KYC) or Know Your Business (KYB) verification process, fully comply with our regulatory standards, and deposit a collateral token from the options available on our providers’ platforms.
Which cryptocurrencies can be used for collateral?
The list of acceptable collateral tokens varies depending on the chosen provider and market conditions. Please refer to our platform for the most up-to-date list of eligible cryptocurrencies.
How can I repay the loan?
Loans must be repaid directly to the loan provider as specified in the loan details. If you prefer to repay the loan using fiat currency, please contact our OTC desk for assistance.
Where can I view the details of my current loan?
You can view all details of your current loan in the Loans section of our platform.
Can I repay all or part of my loan in advance?
Yes, you can repay your loan partially or in full at any time directly through your preferred provider’s page. A link to the provider’s page is always available on your Skyline Digital loan details page.
Can I repay the loan in another coin?
No, the loan must be repaid using the stablecoin originally borrowed. Alternatively, you can repay the loan in fiat through Skyline Digital’s OTC desk.
What is the role of the Health Factor in my loan?
The Health Factor is a crucial numeric indicator of the safety of your collateral relative to the borrowed amount. It helps monitor the risk of liquidation for the providers, with a value above 1.0 considered safe.
What happens if my crypto collateral goes down in value?
If the value of your collateral decreases, your Health Factor may drop. A Health Factor below 1.0 may trigger the liquidation of your collateral to cover the loan.
How is the Health factor evaluated on a loan?
The Health Factor is calculated based on the weighted average of the liquidation thresholds of your collateral assets and the total borrowed value. A higher Health Factor indicates lower risk. If it falls below 1.0, your position may be liquidated to maintain solvency.
Can I see different loan options and compare them?
Yes, you can use the Advanced Configuration feature to view and compare different loan options, including providers, stablecoins, and collateral choices, to find the best deal for you and choose your preferred provider.
How do I set the deposit allowance for my collateral?
During the loan process, you will be prompted to approve an on-chain transaction to set a deposit allowance in your previously chosen cryptocurrency. This allows the smart contract to automatically withdraw the necessary collateral from your wallet to complete the crypto to fiat loan procedure.
What happens if I don't set a sufficient deposit allowance?
If the deposit allowance is insufficient, the transaction may fail. If this is the case, you will receive a notification / message on Skyline Digital’s platform and you will need to approve a higher allowance to proceed with the loan.
Are there any risks associated with setting an unlimited deposit allowance?
Setting an unlimited deposit allowance for your loan can enhance transaction speed and efficiency but may expose your funds to higher risk due to unexpected unauthorized access and smart contract vulnerabilities. Ensure you understand the implications before choosing this option.
What if I need assistance during the loan process?
If you need help at any stage, you can contact our support team through the "Need help?" option available on the platform.
How are the fees structured for different loan amounts?
Fees are based on the loan amount and may include transaction and banking fees. Detailed fee information will be provided during the loan configuration process on Skyline Digital’s platform.
Is there a limit to how many loans I can take out at once?
The number of loans you can take out at any given time may be limited by your collateral and the specific policies of the providers. You must check with each provider to understand detailed limits.
Can I change my collateral after taking out a loan?
No, once the loan is issued, the collateral cannot be changed. Ensure you choose the appropriate collateral before finalizing the loan.
What should I do if I face issues with loan repayment?
If you encounter issues with loan repayment, please get in touch with the loan provider directly through the link provided in your Skyline Digital loan details page. For fiat repayment, please contact Skyline’s OTC desk.
Please contact our support team at @skylineotc for any info or if you have any questions.
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